House to probe excessive credit card interests, charges

MANILA, Philippines – The House of Representatives is set to conduct an inquiry into the excessive rates of interest, penalties, and charges being slapped by credit card companies on their clients.

The investigation was prompted by the resolution filed by Quezon City Rep. Ewinston Castelo asking the House committee on banks and financial intermediaries to probe the high charges imposed by credit card companies following numerous complaints from the public.

“If there are perceived abuses by banks and credit card companies, the same must be within the regulation of the state,” Castelo said.

He said “similar credit card agreements between credit card issuers and holders must be reviewed from time to time through the issuance of appropriate circulars to avoid cases of rather unconscionable, iniquitous, excessive or exorbitant interests, penalties, fees or charges, especially in cases of defaults in payments.”

He said there must be well-circulated rules and regulations governing credit card operations of banks and their affiliates.

He said he hopes the inquiry will have “a soothing effect on credit card holders who found themselves” at the mercy of these firms.

“There is still hope that a fairly universal rate of interests, penalties, or charges among credit card companies can be institutionalized to help the clientele that they serve, in this case, the many middle class credit card holders,” Castelo said. –Paolo Romero (The Philippine Star)